John Berry / The Post-StandardMisty Elliis, of Union Springs, pays for her groceries after shopping at the Tops in Auburn with her son Brett, 2. Cashier Bobby Kindred, 19, of Auburn, checks her total. Editor's note: Staff writer Mark Weiner contributed to this report.

Wilmington, Del. -- The fate of the stores and assets of the bankrupt owner of P&C Foods may be coming down to an epic battle between two grocery powerhouses: Schenectady-based Price Chopper and Buffalo-based Tops Markets.

In a sometimes tense U.S. Bankruptcy Court hearing in Wilmington, Del., on Friday, Price Chopper’s lawyers railed against Tops’ last-minute $85 million for most of Syracuse-based The Penn Traffic Co’s assets. Price Chopper lawyers demanded Judge Peter J. Walsh accept its bid of $54 million for 22 P&C stores.

Walsh refused to make a ruling, ending the two-hour hearing without saying when the next hearing in Penn Traffic’s bankruptcy case would occur. Walsh informed Tops officials Friday that the company is the so-called stalking horse or top bidder in the Penn Traffic bankruptcy case, sources told The Post-Standard.

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Penn Traffic filed for Chapter 11 bankruptcy protection from its creditors on Nov. 18, its third bankruptcy filing in 10 years, and its last. The company says it wants to sell all of its assets and it will be out of business no later than mid-February.

At 2 a.m. Friday — 12 hours before the hearing in which Walsh was scheduled to rule on official offers filed so far — Tops filed its $85 million bid.

In an interview with The Post-Standard hours after the bid was filed, Tops president and CEO Frank Curci said the company didn’t expect Walsh to rule Friday on its bid — or any bids — because of the 2 a.m. filing by Tops.

Curci said Tops is determined to see its offer through and is familiar with Penn Traffic’s operations. “We have the same union local, we have the same supplier, we go to market in a similar way, our customer bases aren’t all that different,” said Curci.

“We may not be in Syracuse proper but we’re kind of all around it. So we understand these markets and what the customer needs are. And don’t forget that here at Tops, when I was here last time, we were a 156-store chain so we’re used to complexity and we’re used to a fairly big store base and while our company is young, a lot of us have been in this business in this area for a very long time.”

Golub insists Penn Traffic has a valid contract to sell the 22 stores to Price Chopper and accepted a down payment.

Golub told The Post-Standard at one point it had been pursuing an agreement with Morgan Stanley, one of Tops’ lenders, in a partnership to buy Penn Traffic. Golub said his company withdrew from the partnership because, he said, the goal of Morgan Stanley — and Tops — is to close 22 Penn Traffic stores, and the per-store price from Morgan Stanley doesn’t measure up to Price Chopper’s.

Then Price Chopper made a separate offer directly to Penn Traffic, Golub said.

“Our position has been if we are lucky enough to get the stores we want, we will remodel them, bring them up-to-date, clean them, refreshen them, restock them and make them Price Chopper stores,” said Golub. “At the 22 stores we wish to have, we plan on hiring 3,300 people. How many will they hire for the 57 stores they really want? Whatever they hire, gee whiz, there are going to be a lot more people employed if we make those stores Price Choppers.”

Tops has not put a number on how many stores it plans to close. However, Curci said, some stores will be closed.

In the courtroom Friday, Price Chopper’s legal team heated up the debate. “We feel we had a valid, binding contract to seek court approval,” said Raymond L. Fink, a lawyer representing Price Chopper, anger rising in his voice.